EU indicators on social inclusion and social protection and the EU 2020 poverty and social exclusion target – state of play Kornelia Kozovska Secretariat of the Indicators Subgroup of the Social Protection Committee DG EMPL This chapter identifies some of the core aspects of the EU’s labour market and social situation underpinning the principal challenges facing policy makers today and in the near future as they strive for inclusive as well as smart and sustainable growth within the Europe 2020 strategy. It does not, however, attempt to take a look at the quarterly developments in EU labour markets as this is regularly done in the EU Employment and Social Situation Quarterly Review. The analysis starts with a look at key trends in EU labour markets and developments in income and poverty, supplemented by a section on the Europe 2020 targets on employment and poverty. It then addresses challenges and actions needed in order to counteract the sustained polarisation between different categories of citizens and divergence seen across the EU in this respect. 1

EU indicators on social inclusion and social protection a result of the EU cooperation in social inclusion and social protection (the social OMC) cover three strands: social inclusion, pensions, health and long-term care each strand constitutes a commonly agreed condensed and comprehensive monitoring tool of a country's social situation with regards to the common objectives in each strand recognize fully the multi-dimensional nature of poverty and social exclusion by looking at it from different facets (e.g. breakdowns – age, education, marital status, employment status, accommodation tenure status; access to services) focus is on data sources which allow for cross-country comparisons and monitoring progress (EU/NAT)

How are the EU social indicators used? Europe 2020 including NRPs and the Joint Assessment Framework National Social Reports and reporting process in the context of the EU cooperation in social inclusion and social protection In-depth/specific policy work (e.g. child poverty) on behalf of the Commission and SPC

Measuring poverty and social exclusion (1) The need for a multidimensional approach - relative poverty vs. absolute poverty, access to (quality) services Council decision (1975) defined the poor as ‘individuals or families whose resources are so small as to exclude them from the minimum acceptable way of life of the Member State in which they live’ Implications for a very diverse Europe after the Enlargement and even more so today

Measuring poverty and social exclusion (2) At risk of poverty rate - a measure of relative poverty The share of people with an equivalised disposable income (afer social transfers= below the risk-of-poverty threshold, which is set at 60 % of the national median equivalised disposable income Material deprivation – a measure of (absolute) poverty across the EU Persons who cannot afford at least 3/4 out of the following 9 items: i) to pay rent or utility bills, ii) keep home adequately warm, iii) face unexpected expenses, iv) eat meat, fish or a protein equivalent every second day, v) a week holiday away from home, vi) a car, vii) a washing machine, viii) a colour TV, or ix) a telephone

Measuring poverty and social exclusion (3)

Recent developments in the work on indicators Improvement of the material deprivation measure Developing a child deprivation measure Improving the use of work intensity as a measure of levels of attachment to the labour market and its interrelation with the poverty status timeliness

Severely materially deprived EU 2020 poverty and social exclusion target « To reduce the number of people at risk of poverty and social exclusion by 20 million » Severely materially deprived 40 mio At risk of poverty 81 mio Jobless households 38 mio 116 million - or 23.5% - of Europeans were living at risk of poverty or social exclusion in 2010

The number of Europeans living at risk of poverty or social exclusion remains stable – 116 million or 23.5% in 2010 Population at risk of poverty or social exclusion*, 2010 Various facets of poverty and social exclusion* At Risk of Poverty Severe Material Deprivation Jobless Households Severely materially deprived 40 Mio At risk of poverty 81 Mio Jobless households 38 Mio * People at risk of poverty or social exclusion are at least in one of the following three conditions: at-risk-of-poverty, severely material deprivation or living in a jobless household. Source: European Commission

Evolution of the population at risk of poverty or social exclusion 2008 – 2010 Source: Eurostat, EU-SILC (ilc_peps01)

At-risk-of-poverty rate, changes 2008-2010

Severe material deprivation rate, changes 2008-2010 Population share living in very low work intensity households, changes 2008-2010

People living in poverty or social exclusion (in %) Ambition levels are very different across MS People living in poverty or social exclusion (in %) Population at risk of poverty or social exlusion* in 2010 2020 target** * People at risk of poverty or social exclusion are at least in one of the following three conditions: living with less than 60% of the national median income (“at-risk-of-poverty” threshold), severely material deprivation or living in a jobless household. ** Some Member States have no marked national 2020 target on this graph because they have chosen to use a different monitoring indicator which does not directly translate into a comparable indicator at EU level. Source: European Commission 13 13

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